German Tuners in Trouble?

It was an impressive display, to say the least.

It was an impressive display, to say the least. Germany's foremost tuning shops pulled out all the stops at the in March, and by the look of their extravagant creations, one would be hard pressed to believe there was a worldwide recession going on. About a month before the show, I spoke to a few old friends in the business to ask how things were.

"Business is fine," Ralph Niese, representing Hamann and Gemballa, said. "Although much of the world is going through tough economic times right now, there will always be people who have money to burn."

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Whether he was expressing genuine optimism or playing the role of diligent PR man, I don't know, but a week later, Gemballa founder and president, Uwe Gemballa, mysteriously disappeared. According to newspapers in Johannesburg, South Africa, Gemballa was connecting through the capital city on a business trip when he vanished into thin air. Police said he was last seen with a seedy Czech businessman outside the airport. At first, everyone suspected kidnapping, but no ransom demand was ever made. Was he even alive? I've met Uwe on a number of occasions—a dashing European businessman in his mid-50s—so I had a personal interest in his whereabouts. It seems I wasn't the only one; apparently, Gemballa had accumulated a considerable amount of debt.

And all this time, I thought the German tuners were doing so well.
Claus Ettensberger, president of CEC, the biggest German aftermarket distributor in the U.S. representing AC Schnitzer, Brabus, Novitec Rosso and TechArt, to name a few, said the display in Geneva was just to show that they were still a major force in the car business. According to Ettensberger, the German tuners are hurting right now, as the global recession has finally caught up with them.

"The reason you saw those extravagant cars at Geneva was they had already decided to display those cars several months before the show. They purchased the floor space and started development on their cars when times were still relatively good," Ettensberger said.

He contends that the German aftermarket was relatively healthy until about early 2010, when suddenly the bottom fell out. "The German upscale aftermarket was the last to get sick, and unfortunately, will be the last one to recover. So things will continue to be difficult for them, at least for a while. That said, we here in the U.S. are seeing a slight rebound and are anticipating a healthy 2011," he said.

Although he doesn't see the big players going kaput, Ettensberger does say that smaller firms will be in survival mode. And the larger ones will need to evolve with the times. CEC has navigated through these tough times by offering a calculated balance of value (custom wheels) and wild excess (over-the-top engine tuning) to its customers. He says the days of the $5000 body kit and suspension upgrade are gone.

"These companies have to realize that not many people are going to pay big money for a German tuner car unless there are major engine upgrades. Some tuners are reluctant to do this because it can get expensive. But I'm telling my clients that this is the only way to go now because most people who want to visually stand out can get the job done by simply throwing on custom wheels," he explained.

As the German carmakers keep producing exciting cars such as the Panamera and SLS AMG, it would be a real shame if there were no one left to give these production machines that special enthusiast's touch. I'm confident that companies like Brabus, Ruf and TechArt will survive this terrible economic storm, and maybe, just maybe, I'll run into Uwe again someday.